Ciena Shrugs Off a Few Revenue Delays, Promotes Locoh-Donou

Ciena's reporting schedule offers a one-month-more-recent window into the state of the industry, and this quarter what they saw slightly lower than expected revenues, but nevertheless managed to best estimates for non-GAAP earnings per share by a few pennies. Here are their results in some context:

$ in millions

FQ3/14

FQ4/14

FQ1/15

FQ2/15

FQ3/15

FQ4/15
(guidance)

-Converged Packet-Optical

382.0

383.3

336.6

432.9

408.0

-Packet Networking

69.5

56.4

55.0

53.3

57.2

-Optical Transport

31.0

26.5

22.3

16.5

17.5

-Software and Services

121.1

124.8

115.3

118.9

120.2

Revenue

603.6

591.0

529.2

621.6

602.9

665-700

Adj. OPEX

206.3

203.7

197.3

207.9

202.1

~225

Adj. GM%

44.3%

37.9%

44.1%

44.4%

45.3%

44%

Adj. EPS

0.32

-0.08

0.12

0.35

0.37

Revenues had been expected to be around $630M for the quarter, but for next quarter the analyst consensus on Yahoo Finance had been looking for $662M, far shy of the midpoint of guidance at $683M. Ciena chalked that up to "the timing of network implementations at certain large service provider customers". The effect appeared to be limited to the company's converged packet-optical lines, with other categories each seeing growth during the quarter. Ciena recently bought Cyan, but that deal closed after the quarter ended and so does not distort the organic peformance just yet.

Meanwhile, Ciena now has a new Chief Operating Officer. They have appointed François Locoh-Donou, who has been their SVP of Global Products for the past four years, leading their R&D and product development efforts. He will now take on the COO role reporting to CEO Gary B. Smith. We had the opportunity to interview Mr. Locoh-Donou here on Telecom Ramblings last year, where he offered insights into his leadership philosophy.